This act states that all petroleum resources are of public ownership and that the Ministry of Oil is responsible for exercising this right on behalf of the Islamic Government, having the power to companies to conduct upstream petroleum operations in the country. The law further establishes the Supreme Committee for Supervision of Petroleum Resources as a supervising authority for such matters, with the following duties:
- Investigating and assessing the implementation of policies and plans of the Ministry of Oil, in the process of preserving oil and gas resources, optimising production and maximising the economic value of such resources;
- Examination and assessment of text, financial volume, obligations, production amount and other aspects of oil and gas contracts, aiming to preserve the produced revenue from public property resulting from the oil and gas industry, as well as to verify contract implementation;
- Submitting an annual report to the head of state and the Islamic Consultative Assembly.
The law also requires the Ministry of Oil to exert proper supervision and take due care, in the course of petroleum operations and through sound planning, to ensure the conservation of petroleum reserves, wealth and installations and prevent environmental pollution in coordination with related organizations.
Originally passed as the Petroleum Act of 1987, this law was significantly amended by the “Petroleum Law Reform Act” of 2011.